The stock market bounced off the 1475 barrier for several days, then on news that the republicans would cave on the debt ceiling busted through. Most on Wall Street are saying the worst is now behind us; people have paid down their debts substantially, housing and employment are slowly recovering, and the Euro crisis seems under control. Is it true? Will it be smooth sailing from here? Time will tell, but I don't think the economy is quite as well patched up as many others seem to think.
Republicans indicate they want a 3 month extension on the debt ceiling. They see the debt ceiling as a losing issue, so they want it out of the way when they fight the democrats on the sequester, the (currently) required budget cuts.
War watch: Japan's prime minister took a trip to Vietnam where he and the Vietnamese prime minister agreed Wednesday to deepen bilateral security cooperation. It would not be surprising to see the Philippines join this, as they also have concerns about China's aggressive stances in the oceans. China's general staff issues recent orders that the army should train to "fight and win wars" due to the efforts of other countries to "contain China." Then China sent a few warships into (nominal) Japanese waters, where they steamed around for several hours, asserting a claim. And China issued new passports to their citizens with an included map that show hundreds of small islands claimed by Japan, Taiwan, Vietnam and the Philippines.
In monitoring by the U.S. Embassy, Beijing pollution levels were at 886 micrograms per cubic meter in a reading that was labeled "beyond index." By Monday, levels had declined to about 350 micrograms on the Beijing government scale - down from a high above 700 but still way above the level of 25 considered safe by the World Health Organization. China currently gets 70% of its energy from coal, so we're looking at a modern London here. Following a London smog during the winter of 1952 that resulted in 4,500 deaths and 15,000 illnesses, the UK eventually passed the Clean Air Act of 1956. A report published last year suggested that air pollution could be behind at least 8,572 deaths in four major cities during 2012. Smog particles penetrate deep into the lungs, carrying bacteria and virus deep into the lungs, and perhaps eventually causing lung cancer. In the picture below we see a reporter on the left with a landscape behind him; the right image is shot from the same location, minus the reporter, on a clear day.
California democrats note that illegal aliens are not able to get drivers licenses, and they kill people in accidents at three times the rate of licensed drivers. Their solution? Give the illegals licenses.
The Feds report that they are holding well over $100 billion in erroneous social security deposits. It seems obvious that the bulk of these deposits are to forged SSNs used by illegals. Curiously, if an illegal makes payroll deposits into SS, even with a forged number, they are then eligible for SS benefits, with only the provision that the benefits must be deposited in a foreign bank. So an illegal who works here for ten years making deposits on a forged SS number can then claim full SS benefits, something like $1200 / month for life.
Households have paid down their excess debt, or so we're told. Is it true? In the chart below we see that debt has indeed been paid down a bunch. We also see that historically the pay down undershoots the long term trend line, so likely we have a bit further to go before consumers go nuts again. And finally, we note that the trend line slopes upwards, indicating that the author of this graph thinks that in another 60 years it will be normal for households to hold half again their yearly disposable income in debt, and another 60 years after that twice their yearly disposable income. Not going to happen.
A few weeks ago I noted that on current trends, soon only gays will be getting married. That was a bit of an exaggeration, but only a bit. Single adults now pretty much equal married adults in our population, and the trend is clear.
Why aren't people getting married? I've noted previously that it's well known that when the husband's income drops below double the wife's income, the divorce rate skyrockets. Women aren't interested in marrying a man who doesn't support them. The current recession, the "mancession," has been very hard on unskilled and semi-skilled men, and relatively easy on women. In the graphs below we see that the jobs lost were substantially in construction and manufacturing - traditionally male - and the jobs created were substantially in healthcare and education - traditionally female.
Wall Street tells us that markets are nearly healed, it's safe to start sending them your money again. Please. Is this true? In the graph below we see 112 years of the Dow Jones average. Note that bull markets are followed by bear markets of pretty much the same duration. The last bull was 18 years long; the current bear is 12 years old. Apparently we have another six years to go. Personally, I wouldn't send Wall Street my used bubble gum.
California has long offered a tax deduction to exclude 50% of any gain on the sale of "Qualified Small Business" stock - a company started in California that hired employees and was sold in California. California's capital gains taxes are a high 9%, so the deduction reduced the capital gains rate to 4.5%. But now the state has apparently decided that it no longer needs to encourage entrepreneurs to start and keep their companies in California, so it is eliminating the tax deduction, retroactively - going all the back to 2008. Bills for past due taxes and interest have been mailed out. Expect major lawsuits.
There's strong sentiment in the country these days to do something about guns. And something will happen. Will it work? 1) The last nine multiple casualty shootings all involved shooters who were on psycho-active drugs at the time - anti depressants and/or anti-psychotics. It seems the real answer isn't to ban guns, but to keep guns away from people with diagnosed mental health problems. 2) Several web sites are popping up with downloadable CAD instructions for using 3D printers to make receivers and 30 round clips for .223 assault weapons. Just add a barrel and you're ready to shoot. Several people have demonstrated functioning weapons made substantially from plastic. This technology will only improve. And the files are already distributed over PiratesBay, which means they're never going away.
The National Enquirer reports Tiger Woods wants to re-marry his former wife Elin Nordegren and has even proposed, getting down on one knee and presenting her with a ring during Christmas. According to the report, Nordegren wants a $350 million anti-cheating clause in a marriage contract if the two get back together.
Science: A couple of weeks ago on Dec.29th, a small meteor fell in Sri Lanka. Chandra Wickramasinghe, the director of the Buckingham Centre for Astrobiology at the University of Buckingham in the UK, examined the meteor under an electron microscope and found fossilized diatoms. As you can see in the pictures below, the diatoms are woven into the rock and cannot be earth contaminants. Diatoms are small single celled fresh water Algae that live on sunlight and have hard silicate shells - in fact diatomaceous clay is a popular jewelers rouge. At least half a dozen of the diatoms Wickramasinghe found have not been successfully identified by biologists and are not known on earth. The meteor is believed to be a small part of a comet that broke up. Diatoms are thought to have evolved in the Jurassic period about 200 million years ago in the middle of the age of Dinosaurs. Finding a diatom in a cometary meteoroid brings into serious question where diatoms actually evolved, how long they've been around, and how much of the universe they've filled. Chandra was a research associate of Sir Fred Hoyle, the British scientist that helped bring us radar in WW II, invented the theory of continuous creation, coined the name "The Big Bang" for the rival theory of the universe, and was one of the earliest and loudest proponents of the theory of panspermia, the idea that life fills the universe and the earth was seeded with life by comets. Who's right? I'm on Sir Fred's side, but in any case the idea that the universe was created from nothing 13.7 billion years ago and live evolved from mud and lightning four billion years ago on earth is getting pretty thread worn. However, by court order these "theories" - evolution and the Big Bang - must be taught, exclusively, in most of our schools. Apparently it's simply unthinkable that we could just admit we're really not very sure about the big questions.